Frequently Asked Questions
Questions for the Investment Options Report
These are the input questions that will enable us to project future financial outcomes. As a subscriber, you can run reports with different inputs.
- What is the age of the person being projected?
[If there are two people being projected, write down the older person**]
- What is the size of the total superannuation investments?
- How much might be withdrawn?
- What is Person 1’s current annual contributions to superannuation (usually paid by the employer)?
[This should be at least 9.5% of your pre-tax annual income**]
- If Person 1 is making additional contributions to their super fund, how much is it?
- What annual amount of insurance premiums is paid by Person 1’s super fund?
- At what age does Person 1 expect to retire?
- Does Person 1 expect to have any extra income in retirement? If so, how much and for how many years?
- If there are two people being projected, what is the age of the second person? [Leave blank if there is no second person]
- What is Person 2’s current annual contribution to superannuation?
- If Person 2 is making additional contributions to their super fund, how much is it?
- What annual amount of insurance premium is paid by Person 2’s super fund?
- At what age does Person 2 expect to retire?
- What proportion of your superannuation is in areas such as the stock market (here and overseas), and property?
- What annual fixed fee is charged by the super funds?
- Super funds also charge a fee as a percentage of the size of the fund. What is that percentage?
- Do you own a home?
- What is the maximum insurance premium as a percentage of the annual contribution?
- At what age does insurance stop?
- What is the length of time in retirement at which we report the probabilities of various income levels?
- What is the annual rate at which real salary increases above CPI?
- What is the expected annual real return on growth assets?
This is the annual return above inflation.
- What is the expected annual real return on defensive assets?
- What is the volatility of return for growth assets?
- What is the volatility of return for defensive assets?
- What is the correlation of returns?
- What is the reversion to the mean parameter for growth assets?
- What is the reversion to the mean parameter for defensive assets?
We will process your inputs into our algorithms immediately and email the Report to you within 2 minutes or sooner. Let us know if you have not received it within 15 minutes.
The enhancements that we anticipate delivering in the 12 months of your subscription include:
• Out of workforce (including being unemployed now)
• Optional access to asset allocation of fund, e.g. by your SMSFs accountant or super fund manager
• More asset classes and asset allocation discussion
• Retirement report
• Goal-directed investments with education as one of the goals.
After purchase, your subscription will automatically renew in 12 months. However, we will advise you in advance of the annual subscription renewal 6 weeks, 3 weeks and 1 week in advance of the renewal. If you do not wish to renew the subscription, you will need to cancel by simply clicking the cancel button in your accounts dashboard.
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The mSmart mProjections Report is not a financial product and mSmart does not offer any financial products although Affiliates might offer financial products.
Yes, very much so. mProjection data is encrypted using the same technology as the major banks. Personal identifies are detached to data that is transmitted over the net.
mProjections does not keep any such data. Payments are processed on Stripe or PayPal and the data is secured within the Stripe or PayPal system.
Accreditation of the algorithm
The algorithm has been built by Dr Frank Ashe who is an Executive Director of Mafematica Pty Ltd, ABN 30 167 364 552, and an Honorary Associate Professor at Applied Finance Centre (AFC), Macquarie University. He holds a PhD in Statistics (more commonly known today as data science). His career has been in investment banking and life insurance where he utilised his considerable mathematics, statistics and risk management experience to work in a number of senior executive roles prior to joining academic and more recently, Mafematica.
Dr Ashe is also a Lecturer for the Actuaries Institute and an International speaker on related topics – Behavioural Finance, Risk Management and complex mathematical solutions.
The results of the algorithm have been compared with , and are similar to 2 publicly available sets of figures prepared on recognised quality web sites / and or authors, and have been compared to the ASIC sponsored calculator (although ASIC’s calculator does not include as many results as we calculate).
Technical Questions to do with Superannuation
Not in this version of the calculator, though it is one of the many improvements we have scheduled for the near future.
No, you will need to manually add other income to your estimated income from
super and the Age Pension.
Yes, however if you enter other investment assets in the ‘Advanced settings – other’ section, they will be included in Centrelink calculations as an asset, and income deemed according to Centrelink’s deeming rules.
If Person 1 has additional income in retirement, it may have an effect on their pension amount.
No, this calculator only works for accumulation funds.
No, this calculator only projects income at a steady rate throughout your retirement.
Person 1 can specify that they will receive additional income, perhaps from part-time work, in retirement. The calculator takes this into account when estimating the total steady income in retirement.
You can’t select your retirement income but you can change your retirement income estimate by changing your retirement age, your personal contributions or any of the fields in the ‘Advanced settings’ sections.
The minimum pension you must withdraw each year is calculated as a percentage of your balance, for example at age 65, you must withdraw 5% of the account balance each year. The minimum percentage will increase at age 75 and every 5 years thereafter until you reach age 95.
As your account balance decreases your Age Pension may increase which means you would need to draw less super pension to maintain your income.
Income is estimated before tax although super and Age Pension income is tax free for most people over age 60.
The calculator defaults to expected returns for a diversified portfolio of Growth assets and Defensive assets. Investment options can be changed in the ‘Advanced settings’ sections for the fund.
Yes, in the Advanced questions section, you can change the length of time in retirement you want your super pension to last.
All amounts are in today’s dollars. A forecast cash flow of $100 in 50 years should buy the same shopping cart of groceries as it would today.
Yes, however you will need to make sure you include all fees, including accounting and auditing fees. Also make sure the rate of return and asset allocation is appropriate for the fund.
This calculator does not allow for one-off super contributions. If you are projecting an example of someone close to retirement you could change the super balance to reflect the lump sum contribution expected to be made.
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Understanding our charts
The Income Bar Chart shows the likelihood of a spending level being maintained for 25 years in retirement. The darker the colour, the more likely that the spending level will last.
The number of years in retirement (25 is default), and the Current strategy (default is 65% in Growth assets) can be changed by the user in Advanced Questions.
The Multiple Asset Allocation chart shows the likelihood of a spending level being maintained for 25 years in retirement for a variety of Investment Strategies (Asset Allocations). The darker the colour, the more likely that the spending level will last.
The number of years can be changed by the user in Advanced Questions.